National Harbor, MD (March 31, 2014) – Today at CBA LIVE 2014, the Consumer Bankers Association’s (CBA) Digital Channels Committee in collaboration with Novantas, Inc., released a Digital Marketing Assessment focused on benchmarking, best practices and effectiveness in a space which is turning the traditional model of retail banking on its head.
The assessment found retail bank marketers are rapidly overhauling their websites to make them more dynamic and appealing to tablet and mobile users, as well as to improve their analytic capabilities. At the same time, many of these marketers and their digital channel partners remain frustrated with their ability to analyze and improve the widest path to new household checking acquisition: online shopping followed by a visit to the branch to open the account.
“While the large majority of new-to-bank deposit accounts are opened in the branch, and that won’t be changing soon, digital marketing provides the largest path to acquisition for banks today,” said Chris Musto, Managing Director of Novantas. “Partial solutions like couponing or chat referrals can provide test and learn opportunities, but banks will need to build significantly more robust tools to enhance tracking, and better manage the relationship between digital and other channels.”
New-to-bank customers used online account opening to complete deposit applications an average 5% of the time, but the range was wide: one bank experienced less than 1% of new-to-bank deposit applications completing online, while another reached 12%. Existing customers, despite tending to use the bank’s site and mobile offerings to manage their accounts, were less likely than new-to-bank customers to open deposit products online, with an average of 2% doing so.
“Digital is a vital and growing contributor to the future of retail banking. Our members are rapidly making the online experience complement the branch experience, and know the great value consumers place in having online banking available to them. Banks will serve the consumer when they want it and where they want it,” said Richard Hunt, President and CEO of CBA.
Banks market through their own properties and offsite, using paid and earned media as well as email, and are spending about the same amount on each. Operating budgets for the marketing site, before significant one-time upgrade expenses, averaged 0.8 basis points of retail deposits, while offsite marketing budgets, including media buys and other items, averaged 0.6 basis points of retail deposits. Digital spend as a proportion of retail deposits varied greatly however: Four of the study banks ranked between 11th and 50th in retail deposits among US institutions maintained public site operating budgets of 1.5 basis points or more, while no other study banks reached 1 basis point.
The joint CBA/Novantas project investigated in depth 13 U.S. retail banks selected as a representative sample of the top 100 institutions. The study combined interviews with marketers and digital channel leaders to find the latest trends and thoughts in this must-grow space for financial institutions. The study provides an extended look towards organization and available resources, metrics and tracking, and the role of digital in broader marketing sales efforts with data analysis on marketing spend, marketing site funnels, and the rate of new and existing checking accounts opened online.
The Consumer Bankers Association (CBA) is the trade association for today’s leaders in retail banking – banking services geared toward consumers and small businesses. The nation’s largest financial institutions, as well as many regional banks, are CBA corporate members, collectively holding two-thirds of the industry’s total assets. CBA’s mission is to preserve and promote the retail banking industry as it strives to fulfill the financial needs of the American consumer and small business.
Novantas, Inc. is the leader in customer science and revenue management strategy in the financial services industry. A FinTech 100 Company, the firm’s Management Consulting, Solutions, Data and Research divisions specialize in investigating and interpreting customer needs, attitudes, and behaviors in ways that help companies refine marketing decisions, customer strategies, and sales and service activities. For more information, visit Novantas.com.